nep-res New Economics Papers
on Resource Economics
Issue of 2015‒03‒05
three papers chosen by
Maximo Rossi
Universidad de la República

  1. Supplier Evasion of a Buyer's Audit: Implications for Motivating Compliance with Labor and Environmental Standards By Plambeck, Erica L.; Taylor, Terry A.
  2. Environmental Kuznets Curve and Economic Growth: The Role of Institutional Quality and Distributional Heterogeneity Revisited. By Tapas Mishra; Mamata Parhi; Claude Diebolt; Prashant Gupta
  3. The effect of electricity taxation on the German manufacturing sector: A regression discontinuity approach By Flues, Florens; Lutz, Benjamin Johannes

  1. By: Plambeck, Erica L. (Stanford University); Taylor, Terry A. (University of CA, Berkeley)
    Abstract: Deadly factory fires. Illegal pollution. Injured workers. Many brands have recently been tarnished by publicity of suppliers' labor and environmental violations. This paper provides guidance to buyers as to how they can motivate their suppliers to comply with labor and environmental standards. Obvious approaches (increasing auditing, making it more difficult for the supplier to deceive an auditor, publicizing negative audit reports) can be counterproductive. Less obvious approaches (squeezing the supplier's margin by reducing the price paid to the supplier or increasing wages for workers, precommitment to a low level of auditing) might better motivate supplier compliance effort. Even if the buyer ensures that the supplier's facility is compliant (e.g., through direct investment in the facility), the supplier may outsource some production of the buyer's order to unauthorized subcontractors, exposing the buyer to risk of brand damage. The results in the paper also apply to mitigation of unauthorized subcontracting.
    Date: 2014–03
  2. By: Tapas Mishra; Mamata Parhi; Claude Diebolt; Prashant Gupta
    Abstract: We re-examine the frequency observed inverted U-Shaped relationship between income and environmental quality (Environmental-Kuznets-Curve, EKC) by introducing the roles of institutional quality and distributional heterogeneity. A panel quantile regression of 127 economies run over a period of four decades demonstrates that once endogeneity bias is corrected and heterogeneity in the effects of income and institutional quality is introduced, EKC tends to disappear at higher quantiles of emission but proves its existence at lower quantiles. The non-uniqueness of EKC is also confirmed by robustness checks where various instruments for institutional quality as well as an alternative measure of emission are introduced.
    Keywords: Income and environment, Endogeneity bias, Institutional heterogeneity, Instrumental variable, Panel quantile regression.
    JEL: Q56 C21 C23
    Date: 2015
  3. By: Flues, Florens; Lutz, Benjamin Johannes
    Abstract: Germany taxes electricity use since 1999. The government granted reduced rates to energy intensive firms in the industrial sector for addressing potentially adverse effects on firms' competitiveness. Firms that use more electricity than certain thresholds established by legislation, pay reduced marginal tax rates. As a consequence, the marginal tax rate is a deterministic and discontinuous function of electricity use. We identify and estimate the causal effects of these reduced marginal tax rates on the economic performance of firms using a regression discontinuity design. Our econometric analysis relies on official micro-data at the plant and firm level collected by the German Federal Statistical Office that cover the whole manufacturing sector. We do not find any systematic, statistically significant effects of the electricity tax on firms' turnover, exports, value added, investment and employment. The results suggest that eliminating the reduced marginal electricity tax rates could increase revenues for the government without adversely affecting firms' economic performance.
    Keywords: Efficiency of Environmental Taxes,Control of Externalities,Regression Discontinuity Design
    JEL: D22 H21 H23 Q41 Q48
    Date: 2015

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